DeepTrade: Protocol Fees On Canceled Limit Orders?

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DeepTrade Protocol Fees Charged on Unexecuted Limit Orders: An In-Depth Investigation

Hey guys! Let's dive into a critical issue that has surfaced within the DeepTrade protocol: unexpected fees being charged on limit orders that were never executed. This discovery raises significant concerns and warrants a thorough examination to ensure fair trading practices. This article will break down the issue, analyze the evidence, and discuss the implications for traders.

Summary of the Issue

At the heart of the matter, unexecuted Post Only limit orders are incurring protocol fees, ranging from 0.075% to 0.137%. According to the official DeepBook V3 documentation, these fees should only apply to trades that have been successfully executed. This discrepancy between the documented behavior and the actual behavior is the key problem we need to address.

Why is This Important?

Unexpected fees can erode traders' profits and create uncertainty about the true cost of trading. It's crucial to resolve this issue to maintain trust in the DeepTrade platform and ensure a transparent trading environment. Imagine placing a limit order, thinking you're only risking gas fees if it doesn't fill, and then getting hit with a hefty protocol fee! That's not cool, and we need to get to the bottom of it.

Environment and Context

To understand the scope of the problem, let's look at the environment where these issues were observed:

  • Platform: deeptrade.io
  • Wallet: 0xa46617da774561178446eb08a91c422427a9b079c56304e6fbc8328a21862d89 (This specific wallet was used for observation but the issue might affect others.)
  • Dates: October 30-31, 2025 (This timeframe helps narrow down when the issue occurred.)
  • DEEP Staking: None (DEEP staking status can influence fees, so this is an important detail.)
  • Order Type: Post Only limit maker orders (Post Only orders are designed to add liquidity and should not incur fees if they don't execute.)

What are Post Only Limit Orders?

For those who aren't familiar, Post Only limit orders are a type of order that ensures you only add liquidity to the order book. They will only be executed if they don't immediately match with an existing order. This is beneficial because makers (those adding liquidity) typically pay lower fees than takers (those removing liquidity).

Transaction History: The Evidence

To illustrate the issue, let's examine a detailed transaction history. The table below provides a clear picture of the placed and canceled orders, along with the associated USDC changes.

Transaction Hash Date (UTC) USDC Change Order ID Market Action
2kMfBFaZiCKYsQeLGcab1bUJWUtKsHgh3jHoiRRDDn7f Oct 31, 2025 20:19:00 +10,014.502500 922521671144661420389868722210 xBTC-USDC CANCEL
AxNBpirqGkAbgeYRPkqk2pmvKsAEw9XVsvocJsBZ2i4A Oct 31, 2025 20:18:27 -10,022.004000 - xBTC-USDC PLACE
9CD8Up2GEdp29dDCyBovkFa2t2fBy4QFVRqaDDVvfytK Oct 31, 2025 20:17:52 +9,993.695024 276885646993124443453501187 NS-USDC CANCEL
u2ypxcAsSvhX4ZbqYnHmaeSWhEHVJeRk4g5gRkisjnf Oct 31, 2025 20:17:12 +2,489.393798 224312407954754891724268725825 xBTC-USDC CANCEL
GyJG5F9wkvinrU91HNeDMCpUz22V4Vd9445gBDS27bCb Oct 31, 2025 14:02:10 -10,007.427740 - NS-USDC PLACE
4V6ryGtLbeHvyV13AMHC9dV9PAtYTME28nUU7EQ4N62J Oct 31, 2025 14:00:52 +10,007.800724 276885646993124443453506384 NS-USDC CANCEL
GdewvPDDHPMQAUrwhUA3JpM19of1y1d1QWcRZoZWFUTv Oct 31, 2025 14:00:15 -2,486.563265 - xBTC-USDC PLACE
HQJRFZ5rvbtppKYZpacHd4Qnq5sw5GptFmWRrUgFSsVS Oct 31, 2025 13:57:37 +2,496.230109 223943473073280700691948735502 xBTC-USDC CANCEL
3so5nheCyzztrFqWoRMq4K5Cq7nV91FHbP4rdpNfLmpM Oct 30, 2025 21:33:25 -2,489.689131 - WAL-USDC PLACE
5dJ5p8a5FG8DCDo9qCEvCwpLXNzjKYVHzsKuHmkzxJFY Oct 30, 2025 21:31:43 -2,498.105196 - xBTC-USDC PLACE
DqNzfAeyEtYr7Y3AbboyudBFzWpPVDDUdJq6if6cvyHF Oct 30, 2025 21:27:43 -10,019.999723 - NS-USDC PLACE

Analyzing the Data

The data reveals a pattern: placing and canceling orders results in a small loss of USDC, indicating a fee is being charged even though the orders were never executed. Let's break down some specific cases.

Confirmed Cases of Fee Losses

Here are five specific examples where fees were incurred on canceled orders:

Case 1: xBTC-USDC (0.0748% loss)

Case 1: xBTC-USDC (0.0748% loss)
  • PLACE: AxNBpirqGkAbgeYRPkqk2pmvKsAEw9XVsvocJsBZ2i4A → -10,022.004000 USDC
  • CANCEL: 2kMfBFaZiCKYsQeLGcab1bUJWUtKsHgh3jHoiRRDDn7f → +10,014.502500 USDC
  • Loss: 7.501500 USDC (0.0748%)
  • Order ID: 922521671144661420389868722210

This case clearly shows a loss of 7.501500 USDC, which translates to 0.0748% of the order value, despite the order never being executed.

Case 2: NS-USDC (0.1372% loss)

Case 2: NS-USDC (0.1372% loss)
  • PLACE: GyJG5F9wkvinrU91HNeDMCpUz22V4Vd9445gBDS27bCb → -10,007.427740 USDC
  • CANCEL: 9CD8Up2GEdp29dDCyBovkFa2t2fBy4QFVRqaDDVvfytK → +9,993.695024 USDC
  • Loss: 13.732716 USDC (0.1372%)
  • Order ID: 276885646993124443453501187

Here, the loss is even more significant at 0.1372%, further highlighting the issue.

Case 3: NS-USDC (0.1217% loss)

Case 3: NS-USDC (0.1217% loss)
  • PLACE: DqNzfAeyEtYr7Y3AbboyudBFzWpPVDDUdJq6if6cvyHF → -10,019.999723 USDC
  • CANCEL: 4V6ryGtLbeHvyV13AMHC9dV9PAtYTME28nUU7EQ4N62J → +10,007.800724 USDC
  • Loss: 12.198999 USDC (0.1217%)
  • Order ID: 276885646993124443453506384

Another clear case of fees being charged on an unexecuted order.

Case 4: xBTC-USDC (0.0751% loss)

Case 4: xBTC-USDC (0.0751% loss)
  • PLACE: 5dJ5p8a5FG8DCDo9qCEvCwpLXNzjKYVHzsKuHmkzxJFY → -2,498.105196 USDC
  • CANCEL: HQJRFZ5rvbtppKYZpacHd4Qnq5sw5GptFmWRrUgFSsVS → +2,496.230109 USDC
  • Loss: 1.875087 USDC (0.0751%)
  • Order ID: 223943473073280700691948735502

Consistent with the first case, xBTC-USDC shows a similar fee percentage.

Case 5: xBTC-USDC (+0.1138% gain - anomaly)

Case 5: xBTC-USDC (+0.1138% gain - anomaly)
  • PLACE: GdewvPDDHPMQAUrwhUA3JpM19of1y1d1QWcRZoZWFUTv → -2,486.563265 USDC
  • CANCEL: u2ypxcAsSvhX4ZbqYnHmaeSWhEHVJeRk4g5gRkisjnf → +2,489.393798 USDC
  • Gain: +2.830533 USDC (+0.1138%)
  • Order ID: 224312407954754891724268725825
  • Note: This case resulted in a net gain. Reason unknown.

This case is interesting because it resulted in a gain. This anomaly suggests there might be other factors at play that we don't fully understand yet. More investigation is needed to explain this outlier.

Case 6 (WAL-USDC)

  • PLACE: 3so5nheCyzztrFqWoRMq4K5Cq7nV91FHbP4rdpNfLmpM (Order placed but not yet canceled.)

Summary Statistics

Let's crunch the numbers to get a clearer picture of the overall impact:

  • Total losses: 35.308302 USDC (excluding Case 5 anomaly)
  • Fee range: 0.0748% - 0.1372%
  • Trading pairs affected:
    • xBTC-USDC: ~0.075% average (Cases 1, 4)
    • NS-USDC: ~0.13% average (Cases 2, 3)
  • Observation: NS-USDC fees are approximately 1.73x higher than xBTC-USDC fees. This difference in fee percentages between trading pairs is another important aspect to investigate.

Expected vs Actual Behavior: A Discrepancy

To fully grasp the severity of the issue, let's compare the expected behavior with the actual behavior.

Expected Behavior (per DeepBook V3 docs)

"Fees are charged ONLY upon execution, not upon placement"

For Post Only orders, this means:

  • Placement: No trading fees (only gas ~$0.002-0.003)
  • Cancellation: No trading fees (only gas)
  • No execution = No protocol fees

This is the fundamental principle that's being violated. Traders should not be charged protocol fees for orders that never execute.

Actual Behavior (Observed)

Orders that were:

  • ✅ Never matched (Post Only cannot take)
  • ✅ Never executed (0% fill confirmed)
  • ✅ Canceled by user

Are being charged 0.075%-0.137% fees, which is:

  • 25x-45x higher than gas costs
  • 3x-5.5x higher than documented max taker fee (0.025%)

These figures are alarming. The observed fees are significantly higher than both gas costs and the maximum taker fee, contradicting the documented fee structure.

Implications and Next Steps

This issue has serious implications for traders using the DeepTrade protocol. The unexpected fees can significantly impact profitability and create a negative trading experience.

Key Takeaways:

  • Protocol fees are being incorrectly charged on unexecuted limit orders.
  • The fee range is between 0.075% and 0.137%.
  • NS-USDC trading pair seems to have higher fees compared to xBTC-USDC.
  • The actual behavior contradicts the DeepBook V3 documentation.

Next Steps:

  1. Further Investigation: DeepTrade developers need to investigate the root cause of this issue. This includes examining the smart contract code and the fee calculation logic.
  2. Transparency: Open communication with the community is crucial. DeepTrade should provide updates on the investigation and the steps being taken to resolve the issue.
  3. Fee Reimbursement: Traders who have been affected by these incorrect fees should be reimbursed.
  4. Documentation Update: If the fee structure has changed, the DeepBook V3 documentation needs to be updated to reflect the current practices.

Conclusion

The discovery of protocol fees being charged on unexecuted limit orders is a significant issue that demands immediate attention. By understanding the problem, analyzing the evidence, and outlining the necessary steps, we can work together to ensure a fair and transparent trading environment on DeepTrade. Let's hope the developers address this quickly and keep the community informed! What are your thoughts on this issue? Share your experiences and insights in the comments below!